Section 1 GwG – Definitions
(1) For the purposes of this Act, money laundering is an offence under section 261 of the Criminal Code (Strafgesetzbuch).
(2) For the purposes of this Act, terrorist financing means:
- providing or collecting property in the knowledge that such property will or is intended to be used, entirely or in part, for the purpose of committing one or more of the following criminal offences:
a) an offence under section 129a of the Criminal Code, also in conjunction with section 129b of the Criminal Code, or
b) any other offences as described in Articles 3, 5 to 10, and 12 of Directive (EU) 2017/541 of the European Parliament and of the Council of 15 March 2017 on combating terrorism and replacing Council Framework Decision 2002/475/JHA and amending Council Decision 2005/671/JHA (OJ L 88, 31 March 2017, page 6),
- committing an offence under section 89c of the Criminal Code or
- instigating or aiding and abetting an offence within the meaning of no. 1 or 2.
(3) For the purposes of this Act, identification means
- establishing identity by collecting information and
- verifying identity.
(4) For the purposes of this Act, business relationship means any relationship which is directly connected with the commercial or professional activities of the obliged entities and which is expected, at the time when the contact is established, to have an element of duration.
(5) 1For the purposes of this Act, transaction means any act or, insofar as they appear to be connected, several acts aimed at or resulting in a transfer of funds or other movement of assets or property. 2In the case of intermediation activities of obliged entities as defined in section 2 (1) nos. 14 and 16, the intermediated legal transaction is deemed to be a transaction within the meaning of this Act.
(6) 1For the purposes of this Act, trust means a legal arrangement established as a trust if the legal institution of a trust is provided for in the law applicable to the establishment of the legal arrangement. 2If the law applicable to the establishment of the legal arrangement provides for a legal institution modelled on the trust, legal arrangements established using this legal institution are also deemed to be trusts.
(7) For the purposes of this Act, property means
- any asset, whether corporeal or incorporeal, movable or immovable, tangible or intangible, and
- legal documents and instruments in any form, including electronic and digital form, evidencing title to or other rights to assets within the meaning of no. 1.
(8) For the purposes of this Act, game of chance means any game where a player makes a payment in exchange for a chance to win, and where the occurrence of a win or loss depends wholly or predominantly on chance.
(9) For the purposes of this Act, a trader in goods means someone who sells goods commercially – no matter on whose behalf or for whose account they trade.
(10) For the purposes of this Act, valuables mean goods which,
- on account of their quality, their market value or their intended use stand out from articles of daily use or
- on account of their price, do not constitute everyday purchases.
They include in particular
- precious metals such as gold, silver and platinum,
- precious stones,
- jewellery, watches and clocks,
- works of art and antiques,
- motor vehicles, ships and motor boats as well as aircraft.
(11) For the purposes of this Act, estate agent means someone who commercially acts as an intermediary for purchase, lease or rental agreements relating to land, land rights, commercial property or residential property.
(12) 1For the purposes of this Act, politically exposed person means any person who is or who has been entrusted with a high-ranking prominent public function at international, European or national level or who is or has been entrusted with a public function of comparable political importance below national level. 2In particular, politically exposed persons include
- persons with the following functions:
a) heads of state, heads of government, ministers, members of the European Commission, deputy and assistant ministers,
b) members of parliament or of similar legislative bodies,
c) members of the governing bodies of political parties,
d) members of supreme courts, of constitutional courts or of other high-level judicial bodies, the decisions of which are usually not subject to further appeal,
e) members of the boards of courts of audit,
f) members of the boards of central banks,
g) ambassadors, chargés d’affaires and defence attachés,
h) members of the administrative, management or supervisory bodies of state-owned enterprises,
i) directors, deputy directors, members of the board or other managers with a comparable function of an international or European intergovernmental organisation;
- persons exercising functions that are contained in the list published by the European Commission under Article 1 point (13) of Directive (EU) 2018/843 of the European Parliament and of the Council of 30 May 2018 amending Directive (EU) 2015/849 on the prevention of the use of the financial system for the purposes of money laundering or terrorist financing, and amending Directives 2009/138/EC and 2013/36/EU(OJ L 156 od 19 June 2018, page 43).
3The Federal Ministry of Finance must prepare and update a list as defined in Article 1 point (13) of Directive (EU) 2018/843 and provide it to the European Commission. 4Organisations as defined in sentence 2 no. 1 (i) whose registered office is in Germany must provide the Federal Ministry of Finance with a list containing prominent public functions specified in this provision each year at the end of the year.
(13) For the purposes of this Act, family member means a close relative of a politically exposed person, in particular
- the spouse or civil partner,
- a child and the child’s spouse or civil partner and
- both parents.
(14) For the purposes of this Act, a person known to be a close associate means a natural person for whom the obliged entity has reason to assume that this person
- is, together with a politically exposed person,
a) the beneficial owner of an association as defined in section 20 (1) or
b) the beneficial owner of a legal arrangement as defined in section 21,
- has any other close business relationships with a politically exposed person or
- is the sole beneficial owner
a) of an association as defined in section 20 (1) or
b) of a legal arrangement as defined in section 21
for which the obliged entity must have reason to assume that it was established for the de facto benefit of a politically exposed person.
(15) 1For the purposes of this Act, member of the senior management means an officer or a senior employee of an obliged entity with sufficient knowledge of the obliged entity’s money laundering and terrorist financing risk exposure, and with the authority to make decisions in this respect. 2A member of the senior management does not also have to be a member of the executive management.
(16) For the purposes of this Act, group means a group of companies which consists of
- a parent company,
- the subsidiaries of the parent company,
- the entities in which the parent company or its subsidiaries hold a participation, and
- companies linked to each other by a relationship within the meaning of Article 22(1) of Directive 2013/34/EU of the European Parliament and of the Council of 26 June 2013 on the annual financial statements, consolidated financial statements and related reports of certain types of companies, amending Directive 2006/43/EC of the European Parliament and of the Council and repealing Council Directives 78/660/EEC and 83/349/EEC (OJ L 182 of 29 June 2013, page 19).
(17) For the purposes of this Act, third country means a country
- that is not a member state of the European Union and
- that is not a signatory state to the Agreement on the European Economic Area.
(18) For the purposes of this Act, electronic money means electronic money as defined in section 1 (2) sentences 3 and 4 of the Payment Services Supervision Act (Zahlungsdiensteaufsichtsgesetz).
(19) For the purposes of this Act, supervisory authority means the competent supervisory authority as defined in section 50.
(20) For the purposes of this Act, employees are deemed to be reliable if they can be safely assumed
- to carefully comply with the obligations set out in this Act, other obligations under anti-money laundering and counter terrorist financing law, and policies, controls and procedures introduced at the obliged entity in order to prevent money laundering and terrorist financing,
- to report facts as specified in section 43 (1) to their supervisor or to the money laundering officer, if one has been appointed, and
- not to participate, either actively or passively, in suspicious transactions or business relationships.
(21) For the purposes of this Act, correspondent relationship means a business relationship within which the following services are provided:
- banking services such as providing a current account or another payment account and related services, such as cash management, carrying out international funds transfers or foreign exchange transactions and cheque clearing, by obliged entities as defined in section 2 (1) no. 1 (correspondents) for CRR credit institutions or for companies in a third country that engage in activities equivalent to those of such credit institutions (respondents), or
- services other than banking services insofar as obliged entities as defined in section 2 (1) nos.1 to 3 and 6 to 9 (correspondents) may provide these other services under the respective legal provisions
a) for other CRR credit institutions or financial institutions within the meaning of Article 3 point (2) of Directive (EU) 2015/849 or
b) for companies or persons in a third country that engage in activities equivalent to those of such credit institutions or financial institutions (respondents).
(22) For the purposes of this Act, shell bank means
- a CRRcredit institution or a financial institution within the meaning of Article 3 point (2) of Directive (EU) 2015/849 or
- a company
a) that carries out activities equivalent to those carried out by such a credit institution or financial institution and that is registered in the commercial register or a comparable register of a country other than the one from which the company is actually managed and administered, and
b) that is not affiliated with a regulated group of credit or financial institutions.
(23) 1For the purposes of this Act, a person acting as an intermediary in the trade of works of art is someone who commercially acts as an intermediary for purchase agreements for works of art, including as an auctioneer or gallery owner. 2For the purposes of this Act, a person storing works of art is someone who commercially stores works of art. 3It is not relevant on whose behalf or on whose account the activity defined in sentences 1 or 2 is performed.
(24) 1For the purposes of this Act, financial company is a company whose principal activity consists of
- acquiring, holding or disposing of equity investments,
- purchasing monetary receivables with a financing function,
- trading in financial instruments for its own account,
- investment intermediaries as defined in section 34f (1) sentence 1 of the Industrial Code
(Gewerbeordnung) and fee-based investment advisers as defined in section 34h (1) sentence 1 of the Industrial Code, unless the intermediation of advice relates solely to investments that are distributed or issued by obliged entities under this Act,
- advising companies on their capital structure, their industrial strategy and associated issues and, in the event of corporate mergers and acquisitions, advising those enterprises and tendering services, or
- arranging loans between credit institutions (money-broking business).
2Holding companies that only hold interests in companies outside the credit institution, financial institution and insurance sector and that are not commercially active other than in respect of the functions involved in managing the investment holding are not financial companies for the purposes of this Act.
(25) Parent company for the purposes of this Act is a company to which at least one other company as defined in subsection (16) nos. 2 to 4 is subordinate, and that is not itself subordinate to any other company.